A letter was printed last week citing the city’s AAA bond rating as evidence that (the) “City’s debt isn’t an issue.” The author, promoting a Bill Euille write-in campaign, characterizes other candidates who are talking about the need for better defined policy regarding debt limits, as “complaining,” and admonishes them (and perhaps like-minded residents as well) about “yelling 'fire' by raising a non-existent issue….” I disagree with the premise of this letter, as using the bond rating as the sole metric to declare that "all is well” grossly oversimplifies this critical issue.
The bond rating does reflect the fact that we have thankfully invested conservatively, i.e., as compared to other jurisdictions, and in the year-to-year mix of budget cash capital versus debt. Few would argue that the city has done much that was necessary and good via its Capital Improvement Plan. But there is more to the story.
In FY 2004, the percentage of the Operating Budget (General Fund) used for debt service (of the Capital Improvement Plan), was 4.6 perecent. By the FY 2015 budget it has more than doubled to over 10 percent. We should note that every dollar we spend on debt service, is a dollar we take away from the financial resources we use to run the city every day, including fairly compensating the hundreds we employ to protect and serve us, including police and sheriff personnel, fire fighters and EMTs, teachers, and the city staff. It is shameful that governments at all levels routinely deal with debt issues on the backs of their employees by withholding or minimizing the cost of living raises they earned and deserve.
The existence of municipal debt is a fact of life. It would be naive to debate whether we should have any debt. The real issue is to consider what amount of debt is both reasonable and responsible. I believe therefore, that the rapid doubling of the city’s debt service requirement as a percentage of its operating budget makes debt limit policy an issue that our candidates (as well as residents) should be discussing.
One can look only at the city’s bond rating and suggest that those who are thinking and talking about debt limit policy are “complaining,” “yelling fire” and "raising a non-existent issue.” However, a more complete reading of the facts makes that characterization rather disingenuous, as is the notion that it forms a rational basis for re-electing Bill Euille or anyone else.
No matter where they fall on the question of how much debt we ought to carry, I am grateful that candidates Allison Silberberg, Bob Wood, and Townsend Van Fleet are talking about this critical issue, and I suggest that anyone who seeks to represent us should be doing the same.